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We recently interviewed Vic Shao, CEO of Green Charge Networks, an intelligent energy storage company based in Silicon Valley, and discussed some really interesting topics around Distributed Energy, Solar PV and Energy Efficiency.
How enthused are US Electrical Utilities in welcoming Distributed Energy? Can you quote any examples of how they are working together with manufactures and their clients to bring it about?
The reality is that collectively, electric utilities are spending hundreds of billions of dollars per year to maintain and upgrade the distribution grid with more copper. A mix of distributed storage and software intelligence can do the job at 3X – 10X less. Everyone wins in the long run if we can extract higher efficiency out of the hardware assets we have already deployed on the grid. GCN has been collaborating with Con Edison of New York over the past 4 years to bring distributed energy storage into reality for the New York market. The collaboration has led to a summer load reduction program offering significant rebate for energy storage systems, announced in Q1 2014.
Is it the linkage between Solar PV & Storage Systems that makes it a viable option in many US States? How well does it work commercially with heat pumps, wind turbines, etc
Yes, Solar PV and intelligent energy storage complement each other nicely because together they address two major issues facing businesses in the United States: rising (kW) demand charges and increasing grid outages. The GreenStation will empower commercial, retail, and industrial businesses to save on their monthly electric bills.
What is driving demand and are there any upfront inducements for building and factory owners to invest in the US?
After a couple of decades of energy efficiency initiatives, all the low hanging fruits are gone. According to American Council for Energy-Efficient Economy (ACEEE) Scorecards between 2006 – 2011, the top 10 U.S. States have on average spent 30% more year over year in public benefits to achieve the same amount of kWh savings. Energy efficiency has reached a point of diminishing returns.
In the meanwhile, the price for kWh has held steady and/or decreased in traditionally expensive markets such as California, due to fracking, domestic production, and competition. But on the other hand, the price for kW has been steadily increasing at 7% per year in California for commercial and industrial ratepayers.
The bottom line is that energy (kWh) is no longer the cost driver for commercial and industrial electric ratepayers; power (kW) is where the pain lies. Hence, moving forward building and factory owners must focus on power efficiency. Green Charge Networks’ Power Efficiency Agreement is structured to reduce the peak power demand charges of our customer’s monthly bills. Power Efficiency is the new era in efficiency savings.
Who is driving demand, the manufacturer of Distributed Energy Management Systems, the Utility Companies or the Building Owners?
Rising energy cost is a big part of a business operating expense. But interestingly, average energy (kWh) pricing has actually declined, but demand (kW) has been rising in California at 7% and along the East Coast at more than 5% per year. Many ratepayers pay 50% a month on kW demand in California and have had no way out. The utility companies have changed their rate structures over the years such that demand charges are rising faster than average energy rates and business owners are stuck. Power and demand in kW has been an unavoidable fixed cost business owners incur month after month – until now. Founded in 2009 and led by a team of seasoned energy storage experts, Green Charge Networks (GCN) has a patent-pending controller technology that seamlessly integrates utility data analytics with our GreenStationTM product. Our stochastic software has also been optimized for solar PV and EV charging.
How do you expect demand to grow over the next 5 years and are there any particular vertical markets that offer the best opportunities?
Commercial and industrial customers who have seen their demand charge ($/kW) portion of their monthly electric bill rise by 7% per year over the past decade. Hence, we predict the trend will continue to rise over the next 5 years. Green Charge Networks is adding to its list of customers including 7-Eleven, Walgreens, office buildings, community colleges, and municipalities.
Vic is Chief Executive Officer of Green Charge Networks, an intelligent energy storage company based in Silicon Valley. Since 2009, Vic led the company through its US $12 million smart grid project with Con Edison of New York, the US Department of Energy and Fortune 500 companies on a ROI-driven energy storage GreenStationTM with software intelligence to empower commercial and industrial customers to save on their energy bills. With more than 15 years experience in software development and complex system implementation, Vic is passionate in applying software to improve power efficiency.